In spite of the strong fine of 2.420 billion imposed by the European Commission just over a month ago, Alphabet, Google's parent company, has still managed to report a double-digit revenue growth during the last trimester.
Although the sanction imposed by the European Commission for abuse of a dominant position has logically affected Alphabet's operating income, the company's total revenue in the last quarter exceeded analyst expectations, and suppose the acceleration of its growth.
Alphabet will continue to depend on advertising
Alphabet has published the report of financial results corresponding to the second quarter of 2017 and reporting some revenue of $ 26.010 billion. Most of that revenue, as usual, comes from advertising-centric businesses, which represent $ 22.700 billion of the total $ 26.010 billion, with double-digit growth over the aforementioned period. Still, hardware sales too (the Pixel and Pixel XL phones or the Google Home) seem to have contributed.
Ruth Porat, Alphabet's CFO, rates the company's second-quarter results as impressive: “With revenues of $ 26.000 billion, 21% more than in the second quarter of 2016 […] We are achieving strong growth with great underlying momentum, while continuing to invest in new revenue streams.
Despite these good results, the fine imposed by the European Commission a month ago has caused a drop in Alphabet's operating income in this quarter compared to the previous quarter. Without it, the company would have raised $ 6.800 billion in profit, But even after the record fine, the company managed to report $ 4.100 billion in operating income.
Specialists point out that in the future, Alphabet will continue to depend on advertising as its main source of income although it will try to diversify towards the field of hardware.